Illinois Attorney General Lisa Madigan is joining more than a dozen other attorneys general in a lawsuit against Secretary of Education Betsy Devos after she suspended a federal law aimed at protecting students from fraud at for-profit colleges.
- Massachusetts Attorney General Maura Healey, commenting on the lawsuit filed today by a coalition of 18 states and the District of Columbia against Education Secretary Betsy DeVos, in the wake of the Department of Education's decision to freeze borrower defense rules for the discharge of student debt for borrowers who were misled or cheated by their schools.
The Trump administration last month delayed implementation of the rules, citing a legal challenge by a California association representing for-profit colleges.
The Obama Administration approved the borrower defense regulations in November 2016. This legal action seeks to ensure President Trump's Department of Education complies with the law and implements the protections. "The Department of Education has clear evidence of Corinthian's widespread fraud, yet it has delayed relief for thousands of these former students and others who are still on the hook for their student loan debt".
Rep. Aguilar has held four college affordability workshops since taking office in 2015, including two sessions that were held for students affected by the closures of Everest College and ITT Tech.
However both lawsuits argue that DeVos did not claim or make the case that any damage CAPPS would suffer would be irreparable.
Eighteen states on Thursday sued Education Secretary Betsy DeVos, alleging she unlawfully delayed new federal regulations created to protect student loan borrowers from being ripped off by for-profit colleges and other schools. The rules that Ms. DeVos froze would have shifted some of that risk back to the industry by requiring schools at risk of closing to put up financial collateral.
The lawsuit filed in federal district court in D.C. Thursday asks the court to declare the delay unlawful and order the implementation of the Borrower Defense rule. For-profit institutions said the rules unfairly target them as applications for loan forgiveness dramatically spiked following the collapse of some high-profile institutions. But in a June statement, DeVos said her department would pause the regulations in order to "take a step back and make sure these rules achieve their objective: helping harmed students".
Liz Hill, a spokeswoman for DeVos, said in a statement that the lawsuit brought by the Democratic attorneys general was "ideologically driven".
The regulations at issue provide protections for federal student loan borrowers against abusive practices by schools and colleges, including for-profit companies and assist in enforcing state consumer protection laws.
The Department of Education's negotiated rulemaking committee helped develop the Borrower Defense Rule, in large part as a result of state and federal investigations into for-profit schools such as Heald College.
In an email, Attorney General's Office spokesman James Hallinan said, "Our Office is now investigating exactly how many students are struggling to pay off loans from these for-profit institutions".
Prohibiting schools participating in the Direct Loan Program from using mandatory pre-dispute arbitration agreements or class action waivers to resolve claims with students. The Obama administration admitted "that the regulations would cost taxpayers $16.6 billions over the next decade".